The document defines various financial terms related to interest, annuities, stocks, bonds, and other investment vehicles. It provides definitions for key terms including principal, interest, rate, time, future value, simple interest, compound interest, annuity, borrower, bonds, stocks, and dividends. It also outlines several types of bonds, stocks, and dividends. The document concludes by listing three formulas for calculating simple interest, compound interest, and simple annuities.

1. REVIEWER for GENMATH 2ND
GRADING PERIODICAL EXAMINATION
I. DEFINITION OF TERMS
 INTEREST - It is a fraction or percentage being imputed or charged to a sum of money.
 PRINCIPAL - It is the sum of money that someone borrows or lends.
 RATE - It is the percentage of increase of the investment charged by the lender.
 TIME - It is the period or how long the money is borrowed or invested, usually in years.
 FUTURE VALUE - It is the sum of principal and its interest.
It is the sum of all the payments to be made during the entire term of an annuity.
 SIMPLE INTEREST - It is essentially the interest charged to a borrower or earned by a lender for
the full term of the loan.
 COMPOUNDINTEREST – It is a type of interest where the interest charged or earned is being
rolled-over and reinvested with the principal amount.
 ANNUITY – It is a sequence of payments made at fixed intervals or periods of time
 SIMPLE ANNUITY - A type of annuity where the compounding of interest and payment periods
happen at the same time.
 BORROWER - It is the person or institution who owes the money or avails of the funds of the
lender.
 COLLATERAL – It is a valuable asset of a borrower that is pledged as a security for a loan.
 STOCKS - It is defined as shares of ownership in a corporation.
 STOCKHOLDER - They are defined as buyers of stock issued by corporations, also known as
shareholder.
 COMMON STOCKHOLDER – It is a type of stockholder wherein he or she has voting rights in
choosing the company’s board of directors.
 PHILIPPINE STOCK EXCHANGE – It is the largest stock market in the Philippines.
 DIVIDEND – It is defined as the portion of the company’s earnings that are distributed among its
stockholders.
a. SCRIP – It is a type of dividend issues a promissory note to pay its stockholders at a specific
date.
b. STOCK – It is a type of dividend issues more shares of stocks to stockholders instead of paying
in cash.
c. CASH – It is a type of dividend issues portion of earnings paid out to stockholders; most
common.
d. BONUS – It is a type of dividend made in the form of additional shares rather than a cash
payout.
e. OPTIONAL – It is a type of dividend that a stockholder can choose to take as either cash or
stock.
f. PROPERTY – It is a type of dividend wherein a company issues a nonmonetary dividend or
property to its stockholders, aside from paying cash or more shares of stock.
 BONDS - A bond is a debt investment in which an investor loans money to an entity (typically
corporate or governmental) which borrows the funds for a defined period of time at a variable
or fixed interest rate.
a. CORPORATE – It is a type of bond issued by corporations such as banking sector and real
estates.
b. TREASURY – It is issued by the government to finance its budget deficits.
c. CALLABLE - It is also known as "redeemable bonds," can be redeemed by the issuer prior
to maturity. Usually a premium is paid to the bond owner when the bond is called.
d. SECURED – It is a type of bond that is secured by the issuer's pledge of a specific asset,
which is a form of collateral on the loan.
e. UNSECURED – It is a type of bond with no collateral.
 ISSUER – He is the one who borrows money from investors by issuing bonds
 BUREAU OF TREASURY – It is a government office known as largest issuer of bonds in the
Philippines.

2. II. FORMULAS
1. SIMPLE INTEREST

𝑰 = 𝑷 × 𝑹 × 𝑻
WHERE:
I – Simple Interest
P – Principal Amount/Present Value
R – Rate
T – Time

𝑭 = 𝑷 (𝟏 + 𝑹𝑻)
WHERE:
F – Future Value/Final Amount
P – Present Value/Principal Amount
R – Rate
T – Time

𝑷 =
𝑭
𝟏 + 𝑹𝑻
WHERE:
P – Present Value
F – Future Value
R – Rate
T – Time
2. COMPOUNDINTEREST

𝑭 = 𝑷 (𝟏 +
𝑹
𝑵
)
𝑵𝑻
WHERE:
F – Future value
P – Present value
N – No. of times the interest is compounded per year
T – Time
3. SIMPLE ANNUITY
𝑭 = 𝑪 (
( 𝟏 + 𝒓) 𝑵𝑻 − 𝟏
𝒓
)
WHERE:
F – Future value
C – Contribution/saving
R – Rate
N – No. Of times the interest is compounded per year
T – Time
r –
𝑅
𝑁